Market

GC China Turbine turbines are extremely competitive in both inland and offshore locations

Note: IEC is an International Wind Farm Standard which classifies wind farms on the basis of annual average wind speed. See below for details:

• I-class wind farm with an annual average wind speed of 10m/s
  
• II-class wind farm with an annual average wind speed of 8.5m/s
  
• III-class wind farm with an annual average wind speed of 7.5m/s
  
• IV-class wind farm with an annual average wind speed of 6 m/s
  

For comparison purposes, the starting wind speed for GC China Turbine Corp.’ 1.OMW wind turbine is 3.5m/s and a steady operational speed is assumed.

It can be seen from our analysis that GC China’s wind turbines have extremely strong market competitiveness in both inland and coastal areas.

The accepted development capacity for wind farms in inland areas exceeds 12,000,000kW with current plans for near term install capacity exceeding 1,000,000kW; the install capacity for coastal areas exceeds 100,000,000 – 200,000,000kW which fully meets the needs of the company's current and future market demands. See chart below.

Table 1: Market capacities in some of inland areas (10,000kW)

Table 2: Market capacity offshore wind farms (10,000kW)

Potential Market Capacity

Market capacity for offshore areas (10,000 kilowatts)

GC China Turbine Corp. are well positioned to capture this government mandated growth

China will soon possess the largest wind generation capacity worldwide

China’s Wind Initiatives Likely to Benefit Chinese Companies most

Government Stimulus funds are being allocated to Chinese Companies

“Foreign Makers of wind turbines complain that they have been shut out of bidding for a $5 billion stimulus financed power plant”

• – AP 6/18/09
  
  

"GE has pulled out of the bidding process for expansion of the Jiangsu Wind Farm – believing that it can’t compete against the Chinese incumbents"

• – Reuters “Foreigners swept aside as wind power blows through China” 6/4/09
  
  

"Foreign Manufacturers complain that China's efforts to eliminate turbines with capacities of less than 1 megawatt is also a form of restrictive practice that plays into the hands of domestic firms."

• – Reuters “Foreigners swept aside as wind power blows through China” 6/4/09

Overall strategy

• Identify and target regional market segmentation
• Consistently offer a truly advantageous low cost, high quality product
• Show the breakthrough achievements based on t he sample project at the Daqing inland wind farm as a launching point for further inland projects in the northeastern and northwestern parts of the country.
• To promote our first class manufacturing and low cost advantage across the north.
• Develop and nurture new R & D and  strategically market to offshore wind farms with even larger wind turbines　　 　　

China - Regional market segmentation

Northeast / Northwest - mainstream wind farms

Characteristics: good wind resource dominated by the five largest power companies with intense competition;

Advantages: Our Daqing wind farm sample project - proves low cost and high quality advantages

Strategies: adoption of the resource exchange model; towards entry into regional market competition with low cost advantage.

Inland wind farms

Characteristic: poor overall wind resource as the mountainous area causes greater difficulty in transportation & maintenance;

Advantages: GC China construction offers proven advantages in transportation, installation, maintenance and foundation costs.

Strategies: to extend the proven advantages of inland wind farms & sidestep the intense competition found in the mainstream wind farm sector.　

Coastal / offshore wind farms

Characteristic: good wind resources with occasional catastrophic wind conditions. Continuing need for large-scale development;

Advantages: significant advantages in sea based construction and all-weather capability;

Strategies: pursue R&D of large wind turbine of 2.0MW / 3.0MW in order to occupy the market with unique advantages for the future.